The Maharashtra Sales Tax department is taking steps to apply more caution while disposing of VAT refund applications following discovery of a major refund scam involving officers of the department and traders in Palghar recently. Speaking at an event organised by the Indian Merchants Chamber, Mr Sanjay Bhatia, Sales Tax Commissioner, said, “We have now decided to make refunds only after cross-verification of all transactions related to VAT. In addition, we have started imposing deterrent punishment on officials indulging in swindling.”

Pending claims

He added that the 15,000 pending refund applications pertaining to 2008-09 would be cleared soon because of the successful computerisation of tax administration which had made cross-verification of the deals quite easy.

“We will finish the job of refunds pertaining to 2009-10 within a month. Applicants will get 90 per cent of the refund immediately and the remaining 10 per cent will be refunded after cross-checking,” Mr Bhatia assured the Chamber.

He added that the department would soon come up with an online “dealer information” system on its Web site, which would enable all VAT payers to look into the status of their accounts maintained by the tax department. Computerisation will remove all discretionary powers and if a case of corruption is spotted, remedial action will be swift and decisive, Mr Bhatia said.